Industry News

Fannie Mae won’t face charges in accounting scandal

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The U.S. Justice Department won't file charges against Fannie Mae after wrapping up its investigation of an accounting and management scandal at the government-sponsored mortgage giant, the company announced today. The U.S. Attorney's Office confirmed that no charges will be filed against the company in connection with the scandal, Reuters reported. Analysts told Reuters that former Fannie Mae executives could still face charges. But the Associated Press, quoting a "knowledgeable" but anonymous Justice Department source, said no charges against former employees are expected. The Office of Federal Housing Enterprise Oversight has estimated that Fannie Mae overstated reported income and capital by $10.6 billion from 1998 to 2004, and the company agreed to pay $400 million in fines as part of settlements with OFHEO and the Securities and Exchange Commission. OFHEO also fined Freddie Mac $125 million after a 2003 investigation discovered accounting irregularities that led to a $5 billion...